Public interest disclosures in NSW: Compensation for whistleblowers – Constitutional & Administrative Law

In 1994, the NSW Government introduced the Public Interest
Disclosures Act 1994 (“PID Act”) to offer protection
to whistleblowers who disclose evidence of corrupt conduct or
maladministration by a public authority or its officers. The PID
Act not only declares it illegal to take detrimental action against
a whistleblower for making the disclosure, but it also provides
compensation for any loss suffered by the whistleblower if they do
experience retaliation. This article explains the compensation
available to whistleblowers in New South Wales.

What is a Public Interest Disclosure?

A Public Interest Disclosure is the disclosure of information
relating to a public authority including:

• Corrupt conduct: Any conduct that seeks to
  adversely affect the honest or impartial exercise of official
  functions by any public official or public authority or any conduct
  which involves a breach of public trust.




• Maladministration: action or inaction of a
  serious nature that is— contrary to law, or unreasonable,
  unjust, oppressive or improperly discriminatory, or based wholly or
  partly on improper motives.




• Serious and substantial waste of government
  money.




• Government information contravention: conduct
  that amounts to a failure to exercise functions under the
  Government Information (Public Access) Act 2009.




• Local government pecuniary interest
  contravention: the breach of an obligation imposed by the
  Local Government Act 1993 in connection with a financial
  interest.

Under the PID Act, a disclosure made by a person in relation to
the above conduct will only be treated as a Public Interest
Disclosure and thereby receive protection under this Act if the
disclosure is made to a specific authority by a certain class of
persons.

Making a valid public interest disclosure

Who can make a public interest disclosure?

To be protected by the PID Act, the disclosure must be made by a
public official.

A “public official” is defined as an individual who is
an employee of or otherwise in the service of a public authority
such as a public service agency, local government authority or the
NSW Police.

The public official making the disclosure, must honestly believe
on reasonable grounds that the information they seek to disclose
shows or tends to show, that another public official or public
authority has engaged, is engaged, or proposes to engage, in the
abovementioned conduct.

A disclosure will be protected under the PID Act regardless of
whether the person who made the disclosure is still a public
official.

To whom must the public interest disclosure be
made?

For a public interest disclosure to be valid, the public
official must make the disclosure to an investigating authority,
the principal officer of a public authority or to a member of
Parliament. A disclosure may also be made to an officer of a public
authority or investigating authority to which the public official
belongs to, or alternatively, the relevant authority to which the
disclosure relates to. In this situation, the disclosure must be
made in accordance with any procedure established by the relevant
authority reporting allegations of public concern.

An “investigating authority” includes the Independent
Commission Against Corruption (ICAC), the NSW Ombudsman, the
Information Commissioner, the New South Wales Crime Commission, the
local government investigating authority and the Law Enforcement
Conduct Commission.

What is not a valid public interest
disclosure?

A public interest disclosure that is made largely for the
purpose of avoiding disciplinary action (not being disciplinary
action taken in reprisal for the making of a public interest
disclosure) will not be protected by the PID Act.

Similarly, a disclosure made by a public official that
principally involves questioning the merits of government policy
will not be protected.

Protection of misdirected disclosures

If a public official makes a disclosure to the wrong
investigating authority, that disclosure will be protected under
the PID Act, if the public official honestly believed that they had
made their disclosure to the appropriate investigating authority to
deal with the matter and provided:

1. the investigating authority refers the disclosure to another
   investigating authority or to a public official or public
   authority, or




2. the investigating authority could have referred the disclosure
   but did not do so because it has power to investigate the matter
   concerned under the relevant investigation Act.

Compensation for detrimental action taken against
whistleblowers

Under the PID Act, it is an offence to take detrimental action
against another person in retaliation for that person making a
public interest disclosure. This extends to circumstances where the
person who takes the detrimental action does so because the person
believes that the other person made or may have made a disclosure,
even if the other person did not make such a disclosure.

In both situations, the person, employer, or organisation who
takes detrimental action against a person who made or is suspected
to have made a disclosure will be liable to pay compensation for
any loss that the other person suffers as a result of that
detrimental action.

“Detrimental action” is defined under the PID act as
action causing, comprising, or involving:

Whilst a claim for damages under the PID Act is yet to be
decided by a NSW Court, Carroll & O’Dea Lawyers have
successfully achieved a number of significant settlements for
whistleblowers which have included compensation for loss of
employment, loss of earning capacity, medical treatment expenses,
requirement for domestic assistance and pain and suffering. Without
a court decision, it is unclear whether damages are
‘capped’ by the Civil Liability Act 2002, or
whether damages are able to be assessed based on common law
principles.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.